Insurers have never been change-friendly, but to still seeunderwriters, brokers and claims adjusters hauling piles of paperaround the market is just ridiculous. Why is this industry sotechnophobic? What's the downside of going high-tech? Afterattending ACORD's London Conference last week, I have a feeling theonly thing the insurance industry has to fear is fear itself. Ifyoure not afraid of your own electronic shadow, read on!

Indeed, with many of the necessary data standards and much of therequired technology infrastructure already in place to allow forelectronic trading, ingrained traditions and fear of change are nowthe biggest hurdles facing insurers and brokers looking to godigital, according to experts speaking last week at the ACORDconference.

Technology is the least of your worries, said Sue Langley,director of market operations and North America at Lloyds ofLondon, during a panel on the future of placing.

Fear is a big hurdlethe fear that Im not going to have the samepersonal relationship with the brokers and underwriters, she said.Ideally, you wont lose that with electronic placing, but you willbe able to dispense with the queues for simple changes orendorsements.

Its almost like were pausing for breath, added Paul Jardine, CEOof Catlin Underwriting Agencies Ltd. and chair of the Lloyds MarketAssociation. Weve got the tech in place, so now we have to win thehearts and minds of the market.

Mr. Jardine said that it might be time to throw down thegauntlet so progress becomes more of an imperative. We have targetson contract certainty and claims going electronic, and we may wanttargets on electronic placing as well, he added.

Mr. Jardine also cited commoditization as one of the fearfactors holding up progress on electronic trading.

A bigger challenge is to become more of a portfolio manager andlook at the bigger risk picture, rather than the loss offace-to-face contact on smaller risks, he said. We need to makesure that when we are deploying expensive talent, it should bewhere its most cost-effectively employed.

Throughout the conference, the inability to secure seniormanagement support for the implementation of standards and the moveto electronic trading was cited by speakers here and in attendeesurveys as one of the main challenges facing the market.

Leadership is a finite resource in any organization, said MarkKinsella, chief technology officer at Benfield in the UnitedKingdom. Youre constantly competing for the attention and backingof those who exert leadership so standards are made a prioritythroughout the operation.

The information technology department and the various businessdivisions they serve must therefore work together to make acompelling business case for standards implementation as well aselectronic-trading, or risk losing budget battles to shorter-termconcerns.

If we dont get some significant volume being handledelectronically soon, itll be seen by senior management as a nice tohave rather than as a have to have priority–especially in asoftening [property-casualty] market with the pressure on tocontain costs to keep profitability up, said Mr. Jardine.

We cannot depend on a Field of Dreams mentality that if we buildit, they will come, he added. We need to show the volume to justifythe investment.

Any thoughts on other factors that might be holding up e-tradingin insurance?